‘Flat is the new up’ for brewers

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Brewery Vivant, which opened nine years ago, recently shifted much of its brewing innovation to its newest entry, Broad Leaf Local Beer. Courtesy Michael Buck

Grand Rapids’ beer scene is a different animal than it was a decade ago, and local brewers are balancing a tightrope of producing flagship favorites and producing more experimental beer to stay ahead of increased competition.

Jason Spaulding, co-owner of Brewery Vivant, a staple of Grand Rapids’ Eastown for almost a decade, said his business is experiencing the growing pains as more competition mounts for customers and shelf space.

“Just opening a new brewery doesn’t necessarily mean there’s going to be a line of people at your door,” Spaulding said. “When we first opened Vivant, we just put on Facebook we’d be open at 4 p.m., and there was a line of people all down Cherry Street.”

Similarly, the Mitten Brewing Co., which first opened in 2012 in the Historic Engine House No. 9 in the West Side, has reported plateued sales, particularly in the taproom.

Mitten co-owners Max Trierweiler and Chris Andrus both agreed diversifying the draft list is important to raising foot traffic.

“We’re diversifying our options that we have in our taproom,” Trierweiler said. “We put a gluten-removed beer on our list for the first time. We’ve always done new beers, but we’re looking to do it more frequently.”

City Built Brewing Company, located in Grand Rapids’ Monroe North neighborhood, is a relatively young industry player experiencing over two years of continued success. City Built’s sales grew by about 15% over last year, but as the industry as a whole evolves, the mix of beer to food sales was different from what the brewery was expecting.

Co-owner Ed Collazo said his advisers predicted a 50/50 mix of beer to food sales for 2019, but the numbers revealed something closer to 60% in food sales and 40% in beer sales.

“The margins aren’t what we anticipated because obviously there’s a better margin on beer than there is food,” Collazo said. “Part of our experience is our food is so stellar. People come in at lunch, and some people are drinking, but 90% of them are eating.”

Spaulding said Brewery Vivant sells about 50/50 regarding food and drink, which still equates to selling a lot of food for a small kitchen, however.

Beer sales have remained relatively flat for Brewery Vivant; Spaulding said the brewery sold about as much beer in 2019 as it did in 2018, but in the craft beverage industry, the common saying is “flat is the new up.”

“Very few are growing like 10%,” Spaulding said. “Maybe 2% or 3% growth is amazing. If you’re not losing anything, that’s good.”

Similarly, Andrus predicted the days of double-digit growth are coming to a close.

“Our product is no longer unique just by its existence,” Andrus said. “Every neighborhood has a brewery now. What you do beyond that is what matters.”

Andrus said the focus on community is predominantly what drives The Mitten, and the brewery’s activity has largely been focused on its social mission. The Mitten Foundation, the brewery’s charitable giving arm, will have raised approximately $70,000 for nonprofits by the close of 2019.

The Mitten has raised more than $200,000 for local organizations since its founding.

City Built’s constantly rotating tap list is reflective of the overall trend in craft beer. While brewers usually can rely on year-round beers to draw regular customers, modern craft beer fans usually don’t want to drink the same thing.

“They want beer that’s over-fruited and over-lactated,” Collazo said. “We’ll do more of that next year.”

Collazo said City Built will shorten its draft list for next year, focusing on five flagship brews and leaving room for more unique beers come January.

Ultimately, people come to City Built to try new things, Collazo said, but without having mass-appeal beers, the brewery misses out on regular patrons.

“We want people to hang out here, and people already do, but we want them to drink just one more beer, not try the funky beer and then leave,” Collazo said.

Spaulding said Vivant regularly sells around the 5,000-barrel mark, although it has tried to grow to 6,000 barrels but hasn’t been able to for the past few years. Echoing Collazo’s claims, Spaulding said everybody’s favorite beer is new beer.

“It doesn’t matter what it is as long as it’s new,” Spaulding said. “Having a flagship brew is difficult.”

Vivant still can count on a reliable fan base for its farmhouse ales, like Farmhand, Hopfield and Big Red Coq, but Spaulding said the brewery’s seasonal releases draw the most customer activity.

“When we set up our brewery nine years ago, we set it up with the business model of making three-to-four mainstay beers and a handful of specialty beers throughout a year,” Spaulding said. “However, as we have seen the market shift, we are now making more varieties of styles more often.”

Experimenting with new ingredients has a learning curve, however, and for a brewery to operate efficiently, there needs to be a predictable turnout. In an ideal world, Spaulding said, Vivant would be operating with a dozen smaller tanks rather than six larger ones.

In Kentwood, just off the busy 28th Street retail strip, Brewery Vivant’s “weird cousin” Broad Leaf Local Beer is making a small splash in the industry. Along with a nontraditional approach to beer, Broad Leaf focuses on more nontraditional street food, with a kitchen that emulates a food truck inside the main taproom, but Spaulding said food sales continue to pick up, much to the surprise of everyone involved.

Spaulding said Broad Leaf hasn’t received as large of a reception as Brewery Vivant had hoped, however, but the company has had to learn to adjust, not only with a competitive market but being in a vastly different neighborhood from Cherry Street where Brewery Vivant is located.

Broad Leaf’s location, on Lake Eastbrook Boulevard, is an area Spaulding described as having tons of traffic but not necessarily tons of community. For the area being a major retail corridor, people usually are just out to run errands and return home.

“Our biggest challenge is getting people to know we’re here,” Spaulding said. “If you’re out here, you’re going to Target and you’re going home. You’re not meandering doing social things.”

Although Broad Leaf’s reception wasn’t what Spaulding had hoped, the Kentwood brewery still is building on a reputation from old-fashioned word-of-mouth.

“It’s fun in its own way,” he said. “Everybody’s got a story about how they heard about us.”

City Built Brewing got into the canning space in October 2018, according to previous Business Journal reports. Collazo said the venture has been largely successful, but the brewery has had more success selling out of the taproom than through a distributor.

“If we’re selling it through a distributor, all of a sudden it becomes really hard, and at that point, you have to win on volume, and we just don’t have that capacity, so we’re rethinking how we use our canning machine,” Collazo said.

City Built typically would can about 150 cases of beer per canning run, a couple of times a month, and then sell it in thirds: 50 cases in the taproom, 50 through self-distribution and 50 cases distributed through a third party.

Instead of canning in large quantities once or twice a month, City Built likely will can in smaller quantities directly for sale out of the taproom with larger runs being more event focused.

City Built also is shifting the priorities of its brewing space. During the interview with Collazo, the brewing team was discarding two unjacketed tanks. Collazo said, while having a jacketed tank to regulate beer temperature isn’t necessary with certain kinds of yeast, it isn’t ideal, so the brewery decided to get rid of them and free up floor space to package for those smaller canning runs.

While getting rid of tanks will reduce City Built’s brewing capacity from 1,400 barrels to about 1,100, the brewery still has yet to brew that much beer, Collazo said.

“We’re hoping our new focus on how we approach beer and what we’re brewing will allow us to increase … and we hope to be hitting our head against the ceiling in December 2020,” he said. “I think just some small shifts will help us do that.”

For 2020, new things are coming to Vivant, Spaulding said. Traditionally, the brewery has focused on French- and Belgian-style beers, but next year, the brewery is zooming out for a more Pan-European approach, including lagers, pilsners and other traditional styles.

“We’re looking at Vivant leaning more on traditional beers and Broad Leaf to make our more nontraditional experimental beers,” Spaulding said.

Trierweiler said the main new things for The Mitten in 2020 is pushing more brands for distribution reflective of what has gained popularity in the taproom. West Coast Swing will be distributed for retail come January.

Although regarded as probably the Mitten’s “least sexy” offering, the 5.6% ABV amber ale has a growing brand and a gold medal from the 2018 American Beer Festival.

“I think people searching for beers that aren’t as strong ABV-wise has led to its success,” Trierweiler said, “that and it has an award attached to it.”

The Mitten also will release Bean Ball Blonde, a 5.6% ABV coffee blond ale for distribution at the same time.

“Craft’s rise was largely about lionizing the product, but people don’t camp out for beers anymore,” Andrus said. “You can buy (Founders) KBS at the gas station now. What got us here won’t get us there. New approaches are required.”

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